piotua incone as of year-end 2015? Explain. Assume GE has a 35% income tax rate. As of the 2015 year-end, how much has GE saved in by choosing LIFO over FIFO method for costing inventory? Has the use of LIFO i creased GE's cumulative taxes paid? d increased or de e. What effect has the use of LIFO inventory costing had on GE's pretax income and tax expense 2015 only (assume a 35% income tax rate)? E6-25) Computing Cost of Sales and Ending Inventory Howell Company has the following financial records for the current period. Units Unit Cost Beginning inventory . .. 150 $100 96 92 90 #2 500 Ending inventory is 350 units. Compute the ending inventory and the cost of goods sold for the current period using (a) first-in, first-out, (b) average cost, and (c) last-in, first-out. Analyzing an Inventory Footnote Disclosure The inventory footnote from Deere & Company's 2015 10-K follows. E6-26. Inventories Most inventories owned by Deere& Company and its U.S equipment subsidiar- es are valued at cost, on the "last-in, first-out" (LIFO) basis. Remaining inventories are gener- ally valued at the lower of cost, on the "first-in, first-out" (FIFO) basis, or market. The value of gross inventories on the LIFO basis represented 66 percent and 65 percent of worldwide gross inventories at FIFO value at October 31, 2015 and 2014, respectively. If all inventories had been alued on a FIFO ba sis, estimated inventories by major classification at October 31 in millions
piotua incone as of year-end 2015? Explain. Assume GE has a 35% income tax rate. As of the 2015 year-end, how much has GE saved in by choosing LIFO over FIFO method for costing inventory? Has the use of LIFO i creased GE's cumulative taxes paid? d increased or de e. What effect has the use of LIFO inventory costing had on GE's pretax income and tax expense 2015 only (assume a 35% income tax rate)? E6-25) Computing Cost of Sales and Ending Inventory Howell Company has the following financial records for the current period. Units Unit Cost Beginning inventory . .. 150 $100 96 92 90 #2 500 Ending inventory is 350 units. Compute the ending inventory and the cost of goods sold for the current period using (a) first-in, first-out, (b) average cost, and (c) last-in, first-out. Analyzing an Inventory Footnote Disclosure The inventory footnote from Deere & Company's 2015 10-K follows. E6-26. Inventories Most inventories owned by Deere& Company and its U.S equipment subsidiar- es are valued at cost, on the "last-in, first-out" (LIFO) basis. Remaining inventories are gener- ally valued at the lower of cost, on the "first-in, first-out" (FIFO) basis, or market. The value of gross inventories on the LIFO basis represented 66 percent and 65 percent of worldwide gross inventories at FIFO value at October 31, 2015 and 2014, respectively. If all inventories had been alued on a FIFO ba sis, estimated inventories by major classification at October 31 in millions
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:piotua
incone
as
of
year-end
2015? Explain.
Assume GE has a 35% income tax rate. As of the 2015 year-end, how much has GE saved in
by choosing LIFO over FIFO method for costing inventory? Has the use of LIFO i
creased GE's cumulative taxes paid?
d
increased or de
e. What effect has the use of LIFO inventory costing had on GE's pretax income and tax expense
2015 only (assume a 35% income tax rate)?
E6-25)
Computing Cost of Sales and Ending Inventory
Howell Company has the following financial records for the current period.
Units
Unit Cost
Beginning inventory . .. 150
$100
96
92
90
#2
500
Ending inventory is 350 units. Compute the ending inventory and the cost of goods sold for the current
period using (a) first-in, first-out, (b) average cost, and (c) last-in, first-out.
Analyzing an Inventory Footnote Disclosure
The inventory footnote from Deere & Company's 2015 10-K follows.
E6-26.
Inventories Most inventories owned by Deere& Company and its U.S equipment subsidiar-
es are valued at cost, on the "last-in, first-out" (LIFO) basis. Remaining inventories are gener-
ally valued at the lower of cost, on the "first-in, first-out" (FIFO) basis, or market. The value of
gross inventories on the LIFO basis represented 66 percent and 65 percent of worldwide gross
inventories at FIFO value at October 31, 2015 and 2014, respectively. If all inventories had been
alued
on a FIFO ba
sis, estimated inventories by major classification at October 31 in millions
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